Potentially Useful Governance

7th February 2020

Most of these are simple but not easy and are not found in “recommended texts”. They do beat 80% of airport self-help books, low effort media assertions, lobby group populist demands and “cute”:

 Do NOT use or expect directorships to elevate your social position or calendar. Being a director is primarily a job not a means for scrambling up the greasy pole.

  1. Do understand your company’s numbers – by heart. Minimum includes sales, costs, gross and net margin, capital structure, cost of capital.
  2. Read and write constantly. Read board papers with a pen. Write often – it helps memory and forces you to be articulate not mumbled.
  3. Value is the touchstone in all things – soft and hard. Is what is proposed net better than the alternative? Strive to understand exactly what that means.
  4. Base all relationships on honest statements of what you think and who you are – not what you think others want to hear or think of you.
  5. Do not be tokenistic – seek competence everywhere. Incompetence but gender, age, ethnicity, whatever diversified is simply diversified incompetence.

Strong governance means making consistent high quality decisions (those based on careful thought, data and evidence, eye to the long run, can be written down, have logic). Non contrived authenticity wins.

 

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